Correlation Between American Security and Carnegie Clean
Can any of the company-specific risk be diversified away by investing in both American Security and Carnegie Clean at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining American Security and Carnegie Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Security Resources and Carnegie Clean Energy, you can compare the effects of market volatilities on American Security and Carnegie Clean and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in American Security with a short position of Carnegie Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Security and Carnegie Clean.
Diversification Opportunities for American Security and Carnegie Clean
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Carnegie is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Security Resources and Carnegie Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carnegie Clean Energy and American Security is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on American Security Resources are associated (or correlated) with Carnegie Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carnegie Clean Energy has no effect on the direction of American Security i.e., American Security and Carnegie Clean go up and down completely randomly.
Pair Corralation between American Security and Carnegie Clean
If you would invest 2.30 in Carnegie Clean Energy on November 4, 2024 and sell it today you would lose (0.30) from holding Carnegie Clean Energy or give up 13.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
American Security Resources vs. Carnegie Clean Energy
Performance |
| Timeline |
| American Security |
| Carnegie Clean Energy |
American Security and Carnegie Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Security and Carnegie Clean
The main advantage of trading using opposite American Security and Carnegie Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Security position performs unexpectedly, Carnegie Clean can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Carnegie Clean will offset losses from the drop in Carnegie Clean's long position.| American Security vs. Astra Energy | American Security vs. Alternus Energy Group | American Security vs. Carnegie Clean Energy | American Security vs. Triad Pro Innovators |
| Carnegie Clean vs. Astra Energy | Carnegie Clean vs. Brenmiller Energy Ltd | Carnegie Clean vs. Clean Vision Corp | Carnegie Clean vs. Alternus Energy Group |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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